A person who plans to open a business in 2018 will find it easier to do so in New Zealand than any other country, according to the World Bank.
Those who wish to set up their own company must be aware of certain challenges, such as finding capital or choosing a location. On the other hand, the main obstacle for existing owners involves an expansion of their enterprise.
Statistics NZ said that small- and medium-sized enterprises (SMEs) support economic growth by contributing $65 billion to the gross domestic product. SMEs make up a majority of commercial enterprises in the country, as 97% of around 500,000 companies only have less than 20 workers.
Since 2014, there were more than 10,000 SMEs set up each year. However, most new companies fail to realise that the first two years of operations comprise the most crucial times for a start-up. While SMEs face different issues due to their diversity, lack of capital planning serves as a common problem.
Cash Flow Problems
An SME’s efficient capital-planning strategy should include a contingency plan for collecting unpaid invoices. A debt recovery lawyer may assist you when the problem becomes more complicated, due to debtors that are unwilling to cooperate with you.
In others cases, legal counsel might be necessary if you find yourself in a payment dispute with a larger company. New businesses should take note that an efficient debt collection strategy will be important for their cash flow. Any disruptions may cost your business to collapse within two years after you launched it.
Despite several challenges, the emergence of new SMEs in New Zealand over the last four years indicates a growing confidence in the country’s business environment. What is your opinion on setting up a startup company for 2018?